The 2021 budget is $1.45 billion, a 5.1% percent decrease from the 2020 adopted budget of $1.53 billion, excluding component units such as the Minneapolis Park Board, Municipal Building Commission, and Board of Estimate and Taxation.

The single largest department in the City is the Public Works department. Public Works spends 1 out of every 4 dollars, or 27 percent, of the City’s budget. This goes towards making sure residents, businesses, and visitors have clean water to drink, safe streets to drive on, and that other crucial infrastructure like sanitary and storm water sewers are in good operating condition.

The next largest portion of the City’s budgeted spending is for Capital Improvement and Debt Service – which combine to make up 20% of total expenses. Capital improvements are permanent long-term investments we make in the city’s assets – publicly owned roads, bridges, sewers, etc. – and debt service is another term for the money we owe for any funds that we borrowed.

After Public Works, the next largest departments are the Police Department (11%), Community Planning & Economic Development (7%), Fire Department (5%), and Convention Center (3%). 

The City has budgeted to pay over 3,964 FTEs in 2021, not including the employees of the independent boards. This is a decrease from 2020 of 335.2 FTEs. Notably, 325.2 of the total positions reduced are not eliminated but subject to a hiring freeze for 2021. 

An FTE is a statistical representation of the hours paid to one individual for a full 40-hour work week, each week for one full year. The number of FTEs employed by the City has steadily grown over the past few years and just in 2017 reached pre-recession level highs seen in 2008.

City revenue sources are varied and many. When most people think of City revenues, they think of property taxes, however property taxes only account for 28% of the 2021 budget.

In addition to property taxes the City is funded through licenses & permits – including for construction, rental property, food service and lodging businesses, and others; charges for services, such as inspection fees, animal care and control and adoption fees, zoning and development fees and related; sales and entertainment taxes; utility rates; revenue from the parking facilities we operate both on- and off-street; and Local Government Aid and other aids from the State of Minnesota.

City financial policy dictates how much of a reserve, or “rainy day” amount, we hold in each of our funds. The General Fund and Internal Service Funds carry a 17% and 15% reserve respectively. Self-sustaining Enterprise Funds are required to carry a 25% reserve. The General Fund also has a required amount we’re to hold in contingency in case revenues fail to meet projections, or unplanned expenditures for emergencies pop up. General Fund contingency must be budgeted at no less than 1% of budgeted General Fund expenditures.

The City strives to balance the needs of responsible financial management by holding reserves for unforeseen circumstance with a responsibility to residents, businesses, and visitors to collect only those monies needed to deliver services and carry out our mission. It’s in balancing these two goals that we’re able to maximize public value.

The City of Minneapolis maintains a financial transparency site that allows anyone to investigate their particular budget questions. This site is a helpful first stop as you look for answers about how much the City spends on departments and expense types.